So...we had a shocker in jobs report of 38 K job creation, and further downward revision to previous two months by a fair amount, that is not a picture of growth as drum rolled by Fed Chief and its dozen mouth pieces.....no credibility in their focus of face time on TV......
Indices reacted very well to disastrous jobs report and downward revision and closed near upper end of trading range. These jobs reports are extremely volatile and cannot be taken too seriously, only a trend line indicator, which is still robust.
I expect a reversal of Friday's sector movement as it was overdone......
Here is how we stand in major indices :
S&P 500 @ 2099.13, all time high 2134.72 only 1.67% away
Dow @ 17807.06, 18351.36 all time high only 2.97% away
Nasdaq @ 4942.52, 5231.94 all time high only 5.53% away
As one can see clearly that S&P 500 should be @ new all time high in short order, followed by Dow and Nasdaq to be the last one.....
In this conflicting data market, it is important to be diversified in many sectors like Oil, Gold, Tech, Financials, Chinese & other EEM exposure bets......
We all have to recognize that US is growing faster than any European economy, India has taken over China as the fastest growing economy tipping 7%+ GDP growth.....
Interest rate hike in US could take place in July or September...one time and its done for the year....
US$ is the wild card, IF it goes up substantially, then equities and commodities will be impacted to the downside......
Let us hope that US$ remains contained in its trading range, then we will be OK....
Good luck with your own strategy and comfort level, volatility will remain high.
BLOG does NOT give buy or sell.
Saleem
6 comments:
Hi Stocktrader,
Bought KGC @ $4.89
Saleem
Hi Saleem,
Good luck with more gold stocks!
I am pretty nervous now about the state of the economy, both in this country and the world. The worst part about the jobs report was the downward revisions to the prior months also--it really downgrades my perception of where the economy sits now. I don't know where the next growth driver comes from about the reflex bounce of the industrials finally peters out after overshooting to the downside way too much in the early part of the year. I don't think fundamentals are really there to support that kind of growth in the world anymore--it's the SPLK's that I think have the best chance for continued growth.
I am evaluating a bigger selldown of my portfolio to raise cash and watch the action for a while. The biggest wildcard is how a renewed easy Fed drives valuations up...
Stocktrader
Hi Stocktrader,
Its not a bad picture, revision to 160K jobs growth is above trendline...which we are maintaining even with 38K number.....last 12 months average is above 160 area.....just right for Fed to go slow and steady.....
Good luck with your own comfort level, which is much more important than any trendline.....
Saleem
Hi Saleem,
Sold HUN @ 15.94
Sold WLH @ 16.33
Both stocks have been huge winners from the bottom, are running into short term resistance, and may be more vulnerable to pullback giving their smaller cap status.
Stocktrader
Hi Saleem,
Bought TZA @ 35.43 with all available cash (~20%) for protection.
Stocktrader
Hi Stocktrader,
Good luck with TZA.
Saleem
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